24 June 2010

Australian Prime Minister Julia Gillard and the ETS

Australia has a new prime minister. The Economist reports that an important aspect of Kevin Rudd's fall was his willingness to dump the proposed emissions trading scheme (ETS) after riding the issue of climate change into office:

The trigger was Mr Rudd’s decision in late April to defer a planned emissions-trading scheme (ETS) until at least 2013. Legislation for it is stuck in the Senate, the upper house of parliament, where Labor lacks a majority. Mr Rudd had made attacking climate change a defining pledge of his platform. His apparent decision to abandon it dismayed voters and damaged his credibility on other issues.

It is important to understand that the fall in public support for Rudd was not climate cahnge policy per se, but a perceived difference between rhetoric and reality. Rudd lost credibility.

Early indications suggest that Gillard is not about to repeat that mistake. She has offered only rather tepid support for reviving a carbon price and does not appear to have offered any explicit support for the ETS as it has been presented, from the Sydney Morning Herald:

Prime Minister Julia Gillard says she is in no hurry to start emissions trading, resisting pressure from green groups to take faster action on climate change.

Labor's decision in April to delay emissions trading until at least 2013 contributed to a dramatic dive in the standing of the government and former prime minister Kevin Rudd.

Ms Gillard indicated it would be business as usual on emissions trading under her watch, because there wasn't a community consensus on the need for a price on carbon.

Her words on climate change are worth parsing:

"First, we will need to establish a community consensus for action," Ms Gillard told reporters today, shortly after her election as Labor leader.

"If elected as prime minister [at the next election], I will re-prosecute the case for a carbon price at home and abroad."

She would pursue that argument "as long as I need to" to win over the community.

What is that "community"? It could be the international community, giving her ample room to defer pursuing any form of ETS in the face of a lack of international agreement. She has deftly put off the issue to beyond the next election, which exactly what Kevin Rudd was aiming to do. Politicians know which way the wind blows.